Depending upon your age, you may be covered under employer health insurance, have a standalone policy through affordable care, or you are on Medicare. Or perhaps you are a gambler and have no insurance. It is important to review your options and make the decision which is right for you.

Many clients are not aware that they can qualify for premium tax credits against their affordable care policy premiums if their income is low enough.  Some clients retire prior to age 65 and are surprised to learn that their investment income or IRA withdrawals or Roth conversions could qualify them for premium tax credits which make these policies very affordable. I have had clients who ended up paying only $100 a month for policies.

You may have COBRA coverage available and that may be the best option for you. Until you take the time to review the different plans, you will not know what is best. Don't just listen to others who say COBRA is too expensive or Affordable Care Insurance is too expensive. I have had plenty of clients surprised at the results when they took the time to review their options for their situation.

What about Medicare? There are many rules surrounding Medicare that you need to follow. Certain dates you must meet for sign up or you will pay large penalties. There are different plans for both medical costs and prescription costs. Once you do sign up with your plans there are rules about changing them also.

I recommend that clients review their prescription drug plan yearly at the Medicare.gov site as you can change your plan to a better plan yearly. Your prescriptions change and so do the plans and what they will pay. Be smart and review your options annually.

What about Health Savings Accounts? These can be excellent accounts when you have a policy that qualifies (Medicare plans do not). You can get a tax deduction today for the contributions you put into the account yearly. Also, the growth in the account is not taxed later if you use it for qualified medical expenses. So, the best plan is to fund the account annually and then not touch it until you are 65 and older. That way all the funds contributed were tax deductions and the growth is not taxed either.  A win-win for you!

Talk to your financial planner who can help direct you to an insurance agent or website to help you. Insurance is complex but it can be understood if you take your time and do what is right for you. - Leslie Trowbridge, CFP®